The EULA strikes back: Know what you’re getting into


Don’t get caught offguard because you didn’t read the terms of the End User License Agreement.


We’ve all seen them – windows that pop up before you can install a program, full of legalese. To complete the install, you usually have to scroll through pages and pages of boring text and then click an “I Agree” button. Many people have a tendency to either skim them or skip reading them altogether and get on with their lives.

But it can be dangerous not to read End User License Agreements, or EULAs. Sometimes referred to as “click-wrap” or “click-through” agreements, a EULA governs your use of the software being licensed to you, the end user. It also prevents you from doing certain things.

Most often, with a EULA in place, you cannot:

  • transfer the license
  • make copies of the software
  • rent the software
  • lease the software
  • lend, sell, redistribute or sublicense the software to another user
  • decompile, reverse engineer, derive source code, modify, create a derivative work of or otherwise repurpose the software

A EULA often includes other license terms, such as:

  • term or time period
  • territory
  • warranty conditions (for example, software provided “as is”)
  • limitations of liability (for example, the purchase price of the product)
  • governing law
  • dispute resolution methods

Although this list is not all inclusive, it should give you an idea of common terms found in EULAs so you don’t find yourself in a situation where the licensing party has cause to cancel your license or even sue you. Consumers and small business owners generally have very little to no leverage with these types of agreements and must simply accept them or choose not to purchase, download, book the flight, play the game or use the product.

Long and confusing, license agreements are all too easy to ignore. By taking a few moments to review the terms before checking the “I agree” box, you will be better able to understand what you’re signing up for and accepting so there aren’t any surprises down the road.

For more information on how to manage risks for yourself or your business, contact your local independent insurance agent.

This loss control information is advisory only. The author assumes no responsibility for management or control of loss control activities. Not all exposures are identified in this article. Neither The Cincinnati Insurance Company nor its affiliates or representatives offer tax or legal advice. Consult with your tax adviser or attorney about your specific situation.

Share This Blog:


Comments are closed.